There’s loads of optimism about Thailand as a consequence of its tourism potential, however political headwinds may nonetheless be a game-changer, says Kelvin Tay from UBS World Wealth Administration.

Whereas Thailand stands to be a “large beneficiary” of China’s reopening and an anticipated tourism increase, thus far, outbound tourism from China has been “fairly meager,” Tay instructed CNBC “Squawk Field Asia” Thursday. 

China’s employment numbers have to go up first, he added.

Thailand additionally must reinvest in infrastructure and rebuild at a sooner fee, stated Tay. The nation had plans to construct up infrastructure on its jap seaboard facet by way of new ports and airports, however “that hasn’t actually occurred at this level,” in line with Tay.

That is largely as a consequence of politics, which Thailand has to “get … proper,” he stated.

With 99% of the votes counted, preliminary outcomes confirmed that Thailand’s opposition events, Transfer Ahead and Pheu Thai, secured probably the most seats in the course of the common election on Could 14, Reuters reported.

However for the main Transfer Ahead social gathering to kind a brand new coalition authorities, it might want to acquire the assist of junta-appointed Senate members who get to vote for the following prime minister, Reuters stated.

The Election Fee has 60 days to certify the election outcomes, after which the prime minister will probably be chosen.

Thailand’s elections are a “potential recreation changer,” stated Tay.

Following the votes that confirmed pro-democracy events profitable a robust majority, the Thai baht on Monday shot to its strongest stage since February this yr.

Whereas the benchmark SET index initially rose when the outcomes got here by, however ultimately gave up these early positive factors.

In truth, Thai shares are the worst performers in Southeast Asia this yr, however Tay says Thailand is his “prime choose” within the area.

Thailand’s SET index is down 9.22% this yr, the most important laggard within the broader Asia Pacific area. As compared, Malaysia is about 4.5% decrease and Indonesia’s Jakarta Inventory Index has fallen 2.2% in the identical interval, in line with FactSet information.

One other concern is that monarchy-linked firms may very well be set again by a change in authorities, Tay added.

The Transfer Ahead social gathering has known as for reforms to the monarchy, together with altering its defamation regulation.

Thailand should additionally look to its workforce to drive progress, stated Tay. The nation’s fertility ratio and growing older inhabitants are “one of many worst globally,” he stated, however employees from neighboring Cambodia and Laos could be introduced in to attempt to increase the labor drive. The cultural and linguistic similarities between these international locations make it “straightforward” for Thailand to take action, he added.

Nevertheless, Thailand could should first change its immigration coverage. Even after international employees have been in Thailand for a few years, they’re “nonetheless thought-about as migrants and never … a part of the native inhabitants,” he defined.

Thailand ought to think about offering migrants with a transparent path to residency, he added.

Correction: This text has been up to date to precisely mirror that preliminary outcomes present Transfer Ahead and Pheu Thai events received probably the most seats after 99% of the votes have been counted. An earlier model misstated that.